Two top leaders of the Philippine Senate have pledged support for the Easy Access Credit Program recently launched by the Department of Agriculture and Fisheries which aims to improve productivity, address countryside poverty and end farmers and fisher folks dependence on government dole outs.
Senate President Aquilino “Koko” Pimentel III and the Chair of the powerful Senate Finance Committee, Senator Loren Legarda, have pledged to support the Production Loan Easy Access (PLEA) Program which proposes the establishment of a P50-billion loan portfolio in the 2018 National Budget of the Department of Agriculture and Fisheries through the Agricultural Credit Policy Council (ACPC).
Two weeks ago, I met with Senate President Pimentel to apprise him on the PLEA Program and its impact on greater food production, the reduction of poverty in the countryside and its importance to end farmers dependence on seeds and fertiliser subsidies which cost government billions of pesos every year.
On Tuesday night, June 20, I personally briefed Sen. Legarda on the simplified and easily accessible credit for farmers and fisher folks which I, as Secretary of Agriculture, personally conceptualised and which was fine-tuned by rural credit experts of the Agricultural Credit Policy Council, an agency under the Department of Agriculture and Fisheries.
It was also Sen. Legarda who last year threw her full support to President Rody Duterte’s Free Irrigation Policy and worked for the allocation of P2-billion to cover the Irrigation Service Fees imposed by the National Irrigation Administration (NIA) on rice farmers.
The difficult and tedious process of applying for loans from formal lending institutions has driven farmers and fisher folks to informal lenders and loan sharks to finance their food production activities.
Interest rates in the rural areas range from 60% every year imposed by lending companies and even credit cooperatives to 200% in just four months by loan sharks.
In Barangay Mat-i, Surigao City where I had breakfast in the farm on Friday, June 23, farmers told me that for every P1,000 that they borrow from loan sharks, they pay an interest of two bags of paddy rice after harvest, valued at P2,000.
This means that they have to pay the loan sharks the P1,000 principal and the P2,000 interest in just a matter of 120 days.
These usurious rates have mired farmers and fishermen deep in debt and affected their productivity.
Instead of buying good rice seeds which could yield up to 10 metric tons per hectare per harvest, farmers are forced to use ordinary seeds which only produce about 3 tons per harvest.
Without the needed financing, farmers could not apply the required farm inputs like fertilisers.
Fishermen, most of whom only rent fishing boats to be able to catch fish, also have to run to loan sharks for small amounts needed to buy fuel for their banca, boxes to keep their catch in and even ice.
Under the PLEA Program farmers and fishermen will be identified and accredited through satellite geo-tagging which would establish their exact farm or fishing grounds location to prevent unqualified applicants from abusing the loaning program.
Identified and accredited farmers and fishermen will be issued computerised ID cards with QR codes which would be all that they need to apply for loans ranging from P5,000 to P25,000 to be served by their credit cooperatives or rural banks in their communities.
The loan will be granted without any collateral and a 6% interest rate per year, payable in two years to allow far,era and fishermen to be able to have enough time to make use of their loans to improve their productivity.
Unlike other loaning programs which would take months before the money is released, one of the features of the PLEA is the immediate release of the borrowed amount within five days given the reality that farmers only borrow money when they need it most, like when they need to buy seeds and fertilisers at the start of the planting season.
Among the conditions set by the loaning program is a condition which requires loan applicants to use modern technology in their agricultural activities, like the use of certified seeds and DAF endorsed planting materials to ensure greater productivity.
With a maximum loan amount of P25,000 per household, the PLEA Program is expected to lift about 2 million farming and fisher folk families from poverty every two years.
The proposed funding for the PLEA Program has been included in the Tier 2 Budget of the DAF.
The PLEA Program was launched June 23, the 119th Foundation Anniversary of the DAF in the town of Malimono, Surigao del Norte, one of the poorest towns in the whole country.
An initial loan amount of P15-M was allocated from Malimono farmers and fisher folks taken by an initial funding of P850-M for the program managed by the ACPC.
(File photos of Senate President Koko Pimentel and Senator Loren Legarda downloaded from public websites while photos of my meeting with Sen. Legarda in a simple eatery inside the UP Diliman Campus last Tuesday evening taken by Mayette Tudlas.)
More Stories
Practical Farming: Turn Used Plastic Containers Into Life-Time Laying Nests!
Super Bulb Onion Grown In Alamada, North Cotabato
Kapehan With Pareng Gob